Country of Origin Labelling update & food forums

The Department of Industry Innovation and Science, in partnership with the Department of Agriculture and Water Resources and the Australian Competition and Consumer Commission, will be conducting information forums to educate businesses on the CoOL (Country of Origin Labelling) reforms for food. The forums will be held in capital cities and major regional centres during March 2017.

The forums will primarily target small and medium businesses that work in food production, wholesaling, retailing, importing and related industries such as printing and packaging. They are designed to help businesses understand the new labels, including the requirements that need to be met to make ‘grown in’/’product of’/’made in’ claims and how to determine the proportion of Australian ingredients. The forums will also include a demonstration of the online tool which can be used to help identify appropriate labels for food products.

We encourage you to attend and to pass this information on to others who may be interested.

Competition and Consumer Amendment (Country of Origin) Act 2017

The Competition and Consumer Amendment (Country of Origin) Act 2017 has been passed by Parliament and come into effect. The Act simplifies the tests to justify a country of origin ‘made in’ claim by clarifying what substantial transformation means and removing the onerous 50 percent production cost test. This means that businesses producing goods such as medicines, food, textiles, clothing and footwear will find the criteria for using a ‘made in’ claim clearer and simpler. Food businesses will only need to consider the proportion of local and imported ingredients by ingoing weight, not value, when making origin statements. Other businesses will no longer have to recalculate the relative shares of imported and local content to support their origin claim.

The Act also creates a new safe harbour defence for products labelled in accordance with Information Standards, such as the Country of Origin Food Labelling Information Standard 2016. Complying with these defences will assure businesses that their country of origin claims are not false or misleading under the Australian Consumer Law.

Here are the latest developments regarding the country of origin labelling reforms.

Amendments to the Information Standard

Updated resources

Business forums in 2017

Replacement of the Commerce (Imports) Regulations 1940

Origin labelling for seafood

The safe harbour defences Bill.

Amendments to the Information Standard

As we noted in our last email of June 20, it has been necessary to make some amendments to section 22 of the Information Standard. This section provides labelling options for:

food made in a single overseas country (with or without Australian ingredients), packed in Australia without being substantially transformed

food from one or more different countries (with or without Australian ingredients), packed in Australia without being substantially transformed.

As originally drafted, this section did not fully reflect the policy adopted by Australian governments for products made in a single overseas country with ingredients from one or more other countries.

The necessary amendments have been made and are now in effect, with an amending Information Standard placed on the Federal Register of Legislation (PDF version/Word version) on 5 December 2016. For an explanation of the changes and what they might mean for you, please visit www.industry.gov.au/cool.

A replacement Explanatory Statement (PDF version/word version) have also been provided for the Information Standard. The updated Explanatory Statement covers the amendments to section 22 and provides additional clarity around the application of the Information Standard to online sales. It also clarifies what the definition of ‘country’ is for the purposes of the Information Standard. We encourage you to review the Explanatory Statement to better understand the labelling requirements.

Updated resources available

The country of origin labelling online tool has been updated to reflect the amendments to the Information Standard, and labels for products that meet the criteria of section 22 are now available. The ACCC will shortly update its online guidance materials to cover the section 22 changes and also to provide some further clarity to businesses on other issues. Businesses wishing to stay up-to-date on the latest news from the ACCC, including on country of origin labelling, can subscribe to the ACCC’s Small Business Information Network at www.accc.gov.au/sbin.

The business.gov.au site for the country of origin labelling is being updated, to include information specific to importers. The Style guide is also being revised to clarify some areas we have been regularly asked about.

Business forums in 2017

The department will be conducting forums on the changes to country of origin labelling for businesses in early 2017. To assist us in planning these forums, we are seeking input on where these forums should be held. We would encourage you to participate in the survey and have your views heard.

Replacement of the Commerce (Imports) Regulations 1940

The Commerce (Trade Descriptions) Regulation 2016 (CTD Regulation) is due to commence on 1 April 2017. The CTD Regulation will replace the sunsetting Commerce (Imports) Regulations 1940.

The CTD Regulation aligns with the country of origin labelling requirements for food. The mandatory changes to food labelling will not take effect until the end of the transition period for the Information Standard (1 July 2018). More information regarding the CTD Regulation will be made available on the Department of Immigration and Border Protection website prior to commencement.

Roundtable on origin labelling for seafood

On Monday 28 November, the Minister for Industry, Innovation and Science, the Hon Greg Hunt MP, advised the House of Representatives that the Government would consider ways in which origin labelling for seafood sold in food service outlets could be improved. Assistant Minister for Industry, Innovation and Science, the Hon Craig Laundy MP, will be chairing a roundtable in the first half of 2017 to seek feedback on this issue from stakeholders. Attendees are expected to include representatives from state and territory governments and relevant industry sectors. The outcomes of this process will be reported to Parliament within 12 months.

Safe harbour defences Bill

The Competition and Consumer Amendment (Country of Origin) Bill 2016 to amend the safe harbour defences under the Australian Consumer Law passed the House of Representatives on 29 November 2016 and was introduced to the Senate the same day. The Senate Economics Committee has already held an inquiry on the Bill, releasing a report on 10 October 2016, recommending its passage.

As you may know, the amendment is primarily intended to simplify the tests used to justify a country of origin ‘made in’ claim by clarifying what substantial transformation means and removing the ’50% production cost test’. The Bill also creates a new safe harbour defence for products labelled in accordance with Information Standards. The proposed changes aim to better reflect consumer expectations and international practice and align with the new Information Standard.